A mixed bag for UK giant GlaxoSmithKline as the firm reported pre-tax profits for the second quarter up 8% in constant exchange rate terms to £1.9 billion on the back of sales that rose just 3% to £5.67 billion. The thorn in GSK’s side has been Avandia (rosiglitazone), which tumbled 22% during the three-month period to £349 million, as prescribers backed away following a published meta-analysis that alleged links to cardiovascular disease.
However, the company’s biggest-selling drug Advair continued its advance on the market, growing 12% to £871 million. Its vaccines also impressed, up 6% to £398 million, while double digit growth came from its antiepileptic Lamictal (lamotrigine; +18% to £271 million), Valtrex for herpes infections (valaciclovir; +14% to £226 million) and the heart drug Coreg (carvedilol, +37% to £202 million).
Also on the positive front, a number of potentially multi-billion-dollar new products were rolled out during the last three months, including the breast cancer drug Tykerb (lapatinib; peak sales expectations of $2 billion, according to a research note from analysts Collins Stewart), Veramyst for allergic rhinitis (fluticasone; peak sales expectations of $1 billion) and the anti-infective agent Altabax (retapamulin; peak sales expectations of $500 million).
New wave of products coming through
And the next wave of products include the cervical cancer vaccine Cervarix, which will be introduced in Europe in the next few months. In fact, an incredible 25 new drugs could be launched between 2007 and 2009 and Collins Stewart expect just three of these alone will generate $11 billion: Cervarix ($5 billion), Promacta for for idiopathic thrombocytopenia purpura (eltrombopag; $3 billion) and Tykerb ($2 billion). The company is also expecting a US regulatory decision on migraine treatment Trexima in the coming weeks.
Despite the uncertainty surrounding Avandia, GSK’s guidance for the year was reiterated at earnings per share growth of 8%-10% in CER terms, but it also pleased with the announcement it has more than doubled its share buyback programme to $12 billion over the next two years.
Noted Chief Executive JP Garnier: “Whilst some uncertainty remains around Avandia, we stand firm in our belief that is an effective and valuable treatment for patients. We continue to see very good progress across the rest of our portfolio with the successful launch of five major pharmaceutical products already completed this year. This is strong evidence of our pipeline’s momentum and its ability to create long-term value for GSK.”
Meanwhile, the US Food and Drug Administration has convened a meeting on Monday to discuss the potential risks of the drug class with a specific focus on Avandia. GSK strongly disputes the published meta-analysis and suggested yesterday that data due to be released ahead of Monday's meeting supports the drug's risk:benefit profile and cardiovascular safety.